The increasing push to accelerate the product design process and to minimize physical testing expense has promoted the development of hardware-in-the-loop testing procedures which couple well-defined virtual models with physical systems. Clear advantages include: 1) the advanced screening of candidate designs and control algorithms earlier in the product development phase, 2) lower overall testing cost to the manufacturer, 3) faster test times for design iterations, and 4) greater flexibility in the types of tests possible. This paper describes the design of an economical system that uses a parameterized, model-based vehicle simulation to control the operation of powertrain test cell hardware as part of a real-time test procedure. A commercially available vehicle simulation package allows for the modeling of a variety of chassis and powertrain combinations, along with a wide range of test procedures. This simulation is linked to an automated test stand that controls dynamometer loading and powertrain throttle, clutch, and gear positions. The selection and integration of the key test stand subsystems are detailed in this paper. This proposed method enhances conventional testing methods by providing an improved means of studying the important interactions between a vehicle chassis and its powertrain while remaining in a highly controlled laboratory environment. It is possible to effectively capture important details of powertrain performance that are otherwise lost by more common testing methods. This end result is a proof-of-concept that is potentially more versatile and realistic than traditional steady state or transient powertrain testing.